OUT - Earnings call transcript Q4 2024

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Operator

Good afternoon. Thank you for attending the OUTFRONT Media Fourth Quarter 2024 Earnings Call. My name is Cameron, and I'll be your moderator for today. [Operator Instructions]

And I would now like to pass the conference over to your host, Stephan Bisson, may proceed.

Stephan Bisson

you our thank earnings fourth and call. afternoon, for XXXX joining quarter Good the Jeremy today and me call With on are Nick Male, Brien. Siegel Matthew the session. After for discussion of financial we'll a our a open question-and-answer results, lines

slide Our comments to website, Relations you refer today outfront.com. Investor find the of presentation release on the can section that earnings will and our

listed to forward-looking After statements differ in XXXX cause This conference to forward-looking well. available well there today's call as could these is Form earnings from our that expect SEC in week. our are our XX-K concluded, may materials filings, Form materially as an XXXX we this and statements. include XX-K, which audio actual factors including results our replay will be file as Relevant call

financial to on refer non-GAAP will call. certain this measures We

and be the OIBDA turn references Reconciliations the OIBDA reconciliations. and to the Any are with me prior presentation, non-GAAP to today slide call With appendix also the our of period that, now Jerry. made in an basis. let measures release website, financial which on other includes of presentations over adjusted on will earnings

Jeremy Male

results Stephan, be here quarter pleased and We're outlook. and to XXXX good fourth our Thanks, sharing afternoon, everyone.

of during finished up I'd about details, to Before the both 'XX, and of in diving 'XX the into QX our X% XXXX. which results quickly our highlight exclude like revenues, some accomplishments Organic Canadian business year-over-year.

with by were growth Our higher driven for and year being billboard revenues digital. up the X% static both

XX% digital revenues growth digital revenues which from our grew to our billboard realize platforms, billboard significant to XXXX XX% We our from XXXX. sales automated continue in in of of

nearly provided York high during led improve nicely by rebounded year. here ahead the this by to the MTA The the the of XX% nearly XXXX transit nicely year. segment for guidance grew positive revenues to last X% single-digit transit nearly returning AFFO OIBDA million, $XX we in territory. XX.X%, helping chart growing XXXX, year, adjusted the up time Our New

million June, the essentially to In of Canadian at proceeds our XXX down the year and utilized sale XXXX. ended approximately USD leverage, of sale X.Xx, end at the closed X.Xx all from which the we the of reduce our business for from

Turning fourth now quarter results. to our

can other, numbers Organic ahead and million. sales million was a provided digital equipment of on headline million. see just $XXX You grew was which in $XXX the consists principally X.X%, X. guidance while $X.X revenues growing of now Slide X%; X% the and OIBDA by little over transit November, we growing AFFO

revenue Digital primarily X.X%, up line shows quarter was The X rates, our the as but was top billboard billboard growth. growth X% driven up was detailed Slide by well. higher during occupancy include points while which basis cost in static up estimate impact of we the these the we slightly. was that October, contract growth. of exited Notably, profitable XXX over us marginally numbers

our by growth. revenues. revenue and transit was top Slide in growth static The X% X shows detailed revenues digital XX% growth growth X% our our in line driven

As the much well, continued XX%. MTA perform of been the has to for up case year, the

our categories basis, categories The political financial. quarter quarter and during during were stronger weaker alcohol. health consolidated a CPG, the On and medical were and the technology,

XX% period, XX% last during latter billboard were the year. up which and just both and automated of from and products launched digital the we our and representing XX% almost XX% in the programmatic revenue across up our transit, up of of digital which our over the from with digital revenue of X% digital nearly performance represented quarter first total total, year. sales, combined XX% direct last Slide in revenues, shows growing XXXX quarter nearly digital the include under X revenue Total

just by during was be primarily seen national grew business our of and the can of while revenues a book tech strong driven our quarter, in the The in Breakdown Local U.S. national X%. grew Slide strength X% business by under local and X. verticals. national on financial

hand Slide digital X% to were month. of of to inventory was per and only was financials. static to $X,XXX With about XX yield growth, year-over-year X.X% With billboard let we our remain me solid yield Matt The our drivers billboard up of growth. nearly of that, rest our about continued growth, the review shows conversions. total which confident which digitized, continued digital over up now X% this it our

Matthew Siegel

everyone. Jeremy, Thanks, afternoon, and good

I'd Before and colleague, detailed financials, friend say the my about words getting to to Jeremy like few Male. a

you without of produced year, industry In of last his endeavors. with from navigated out-of-home structure, REIT ever not it announced digitization today CBS the of assets its from the its pandemic and most in his has a his be separation conversion all leadership initial all Jeremy and that CEO, retirement company he wish the XX offering, him end us through years vision future OUTFRONT the operating a may corporate to as well environment, have and OUTFRONT. subsequent public noticed is the challenging rapid a industry-leading Towards nearly the seen. his company here would

to compensation billboard total, were utilities primarily maintenance a payments lease earlier were in share or production million lower than to $X Posting, about $X maintenance or more revenue million New under that expense XX% leases. mentioned let's little and under expenses costs to turn for the and exit Please XX other on financial our due of $X expenses almost Billboard Jeremy due and a and or costs. York portfolio look costs, expenses. the higher Now million a X% detailed up billboard look Slide our less In down at X% statements. billboard little at year-over-year. were

$X of nearly increase million rising the described storm-related costs These revenue under X.X% expenses, and $X combined rose commissions in network Included million million in billboard or earlier, higher with billboard-adjusted was Southeast. expenses to this due the SG&A growth approximately to X% or X%. almost $X costs. led OIBDA Jeremy

basis see to XX.X%. by pleased margin billboard year-over-year points are to We adjusted XX increased OIBDA

on were or as X% expenses utilities compensation. Transit partially total, primarily payments and In maintenance lower Transit to primarily contractually expense to revenue by under million Posting, described obligated the $X.X costs and other Slide increases year-over-year. than were up under to by to franchise due due XX. X%, earlier, over Transit million. just $X expenses fees. maintenance and expenses less with other offset were $X up the Combined higher growth OIBDA $X.X to or lower Transit $X MTA was up fell rose SG&A Turning X% franchises. Transit million million approximately million adjusted professional

is segment return to see in year. the million this it profitability nice to the $XX for the With of OIBDA adjusted generated quarter, full

XXXX. Transit, to to New of our update in expectations take like While I'd the MTA a in for York moment some

the contract. contained Our CPI MAG by about approximately within step MTA X% the year payments up to escalator this $XXX the million at will York City New given

franchise continue our MTA on basis the will for to straight-line account We throughout expense year. a

As network we the substantially MTA our complete. of digital mentioned on our initial last is call, buildout

spend million aged this to to and replace $XX around expect year, broken principally We screens.

of in that in through Looking forward, the expect end contract spend range same the we XXXX. currently will be annually the this

through analysis, the quarterly both and flow be period. end confident this OIBDA we our will Per positive the contract cash remain of

compensation about to prior due forward. fourth OIBDA and these represent adjusted company and combined the Corporate billboard measure, primarily consider earlier, the the transit transit $X the XX adjusted shows essentially from with entire in by company's in OIBDA expense moving OIBDA given about corporate fees. billboard I We quarter. million, this measure totaled million, period. up year professional and Slide rose Combined comparable X.X% important higher covered the $XXX the an

to on Turning Slide XX, capital spend. including $XX maintenance million QX CapEx million, $X spend of about expenditures was

$XX $X related divested full Canadian business. our the to For million, total was year, tax million including about

replace commenced boards revenue expect includes in For will technology installation aging digital look XXXX. for CapEx. of with state-of-the-art XXXX, million this while these installations older still many of to drive great, spend screens believe some we $XX help new of will our million of million we earliest $XX of digital growth. billboards. We replacing About And which $XX our be maintenance, approximately total to

Looking at expense, other transit OIBDA all offset improvement partially interest was million. higher OIBDA, to to billboard by you which AFFO $XXX bridge driven on The see principally lower Slide of can and our subsidiary. nondomestic lower AFFO related and of XX, by our QX the is Canadian

with of nicely As million we we AFFO, of XXXX ended start $XXX year. of the guidance Jeremy provided the mentioned earlier, ahead at the

For XXXX, expect in range, we currently the AFFO driven in by growth mid-single-digit principally OIBDA. reported improvement consolidated

facility. sheet. an cash, $XXX revolver of million accounts available receivable for million, XX million our nearly Slide $XXX almost including to update on Committed and liquidity our our securitization by $XXX million balance turn is by about available $XX Please

comfortable of not end late leverage of XX, X.Xx, target net total with As stack Xx within X.X% We our the range. until and with to our our was from maturity next December down remain debt at well our XXXX. Xx XXXX

Turning $X now during March under Board We on close $X.XX XXXX of business on of to to Directors payable announced to dividend. today that X. at million on total March million. $XX spent our maintained XX record of the to the just dividend cash a our shareholders We our approximately quarter, acquisitions bringing

$XX increasing over of on XX% outstanding assets around interest to to our We consolidated ventures, noncontrolling spend in noncash also subsidiary total million million. X and the joint buy cash spent in our adding consideration $XX

at pipeline, last a our and accomplished the XXXX level lot acquisition delivering Looking at we year last of remain similar fully current a to those In our great focused on couple a in to XXXX. deal years. activity closing, we seen expect are

that, CEO, With over Interim our Nick turn Brien. call let me the to

Nicolas Brien

Matt. you, Thank

This X we about of our be created to is growth guidance, that some on the New last headwind quarter of billboard is my contract, in mid-single this headwind share year. guidance relative I fourth X.X sharing we York quarter with thoughts, flattish headwind X-point that MTA a provide billboard the and point first to exit excludes Canada Before total our up thinking to year includes which the to expect quarter, the will transit in traditionally last the This creates billboard know I up slightly quarterly about and growth. our current the revenues where digits. of by

on lot share about role, we've starting I'd significant company had operational In the smooth much and CEO transition. a unlock. I additional more from the about talented X since a in met What path I've people, and a potential to that organization is like I've differentiated distinct thoughts some Now, the of detailed weeks our is the level. see learned my leadership to and of a has front.

expanding focus Our share the U.S. digital impact spend and of capabilities. accelerating of amplifying our our out-of-home on ad

questions. for see created XX over operator, ahead, with has foundations Jeremy load now I'm started open very the a building promising line that, the just that but And getting strong the last upon years. let's

Operator

[Operator question first Instructions] of Citi. Bazinet the line is with The from Jason

Jason Bazinet

a just question. I had quick

interest congestion to seeing Or tone institutions. work-from-home Given what sort and that by pushed tax the some -- is Are advertisers MTA the back-to-work City was work in any similar New York of you incremental the very among York this contract? push last financial say or for it New you would the year? of

Matthew Siegel

Thanks Matt. it's question. for Jason, the

congestion pricing, see the goes. where We'll controversial. obviously, First, that

For was year our one last EBITDA. revenue us, drivers of the of MTA growth and

about and grew off to revenue far, of XXXX. quarter XX%, think first good a in it's start so pretty the I

caused or force So X.X with good so pleased greater to years and back or work of sales our we're I'm sure last by the it's but congestion just or not focus, the performance pricing from there. work

Operator

Morgan the from Stanley. with line question McVeigh The comes of next Cameron

Cameron McVeigh

I what first, excited helpful. fourth near in quarter? for color biggest about local as what Nick, you're is Was all? see in you guess opportunity the growth what upfront ad at as vertical-specific then Any the future? softer-than-expected recently, driving your there curious be at that And second, most just you've joined in view would and the the

Matthew Siegel

I'll Sure, growth. the ad get you soft Cameron.

back in We have solid comps very 'XX.

are certainly that getting we but and of uncertainty pickup. in second smaller focused plus up, picking pacing year. probably our the So businesses, see but Obviously, half we're some more around we and there's a in post-election still, thinking impacting macro the environment of this see numbers the do better things midsized and lapping some

our that I'll for guide. see what he's from AFFO that, can about. it excited to You pass Nick With

Nicolas Brien

Yes.

a XX I've gives it the as our been that more I said, portfolio our think of campaigns. very significant by many who across focused the portfolio there of discovering sort depth much to just available brand that digital very are digital find progressive in has to credit supported and the built while their in DMAs, as the digital around within got that's that a out-of-home it's offering way of significant resources a those fortify to I excellent brands so and an top is, innovation to great integrate question them confidence creative me lab fully be marketing our strength really seeking is resources, and our because that really the advertisers always involved agency is strength offers of most internal active that's the now, overall

starting full-funnel recognized some out-of-home data care performance has to digital those set and basis. format like world. Netflix to out-of-home Vuitton. in and Richard we and enables Louis and prowess, also always that those brands a And leveraging really been the in brand-building in with Apple we're richer I'm brands, on see famous the that especially brand. And familiarity be they ensuring really and to ability industry space the now active And data biggest strengths have and same and about I care mean transit. in the for build HBO sets of the us about They our

It I confidence greatly greater gives and your want build And be just me obviously question. hope on excites brand necessary that it's full results. who significant transaction the continue because me awareness, extremely funnel the performance that the we for capability those that. consideration, performance how strength to that and from deliver can that answers of maintain to marketers we

Operator

Osley question of line next comes Wells the The Fargo. from Daniel with

Daniel Osley

that results So aren't same. reported national the choppiness in seeing would have your peers suggest growth, ads but seeing some your you

detail that growth the remainder us expectations strength what but should we driving national on the and takes expectation your And And puts consider? you're forward? of year? more So moving of the for what's QX, revenue some that is speak major in should in you seeing and then can the what your gave think we how are about for

Matthew Siegel

we our are quarter. Daniel. and the up -- We're I picking seeing. think Obviously, go Thanks, what on can't seeing we as pretty performance peers national comment good through

have for -- we markets. -- in we give our We guidance different have DMAs

Orleans. peers national think have We New may to in transit business. us It much. Bowl in a well That's helping not MTA. helps our the performing I is strong be all that competitors Super our as in contributing our Nashville or

far rest As as pacing we year, see as the I the mentioned, better the we of through year. go

give in see don't still do take We numbers, half lower can but guidance. in the that AFFO back full quarters What the of year of revenue year us. the is from our you Obviously, visibility. think better in guide first we better front like to quarter we we have

Operator

question The next line TD Lance of from Cowen. comes the with Vitanza

Lance Vitanza

Nick, you're you process I if that I believe right. sort And the still of wondering there is got guess run. wondering interim CEO going. obviously, on, was if bit was unexpected. was just update as earlier. CEO be stepping that you. I'm Jeremy's announced going the just to a process retirement for us is like there this little if your a know I a in going one I'm of it timing seemed I'm could I that is to interim

you things where process and transition could should that period? how in we terms us about So think update stand on of the

Nicolas Brien

the take at level. and for the a buy veteran time. industry underway considerable period I, The that well, significant the groups we can process of is on of a will Directors time. did an a that the and Board side, more with in confirm, formal we process, to Yes. some it on run And Board mean, -- the underway. side that Board haven't of -- I company There's formed subcommittee process global Jeremy sell search In the there many the been discussed say of be agency the the than

let's predict time nature You search that the company level during exactly that of and opportunity can't the say, the to always that the the were expertise, if and ongoing. that of the broadest experience period and was we together resource has was that doing the ensure of

and responsibility, the that's the of leading Board subcommittee working continues the with recruitment my of while follow involvement firms that's the So search. X to my world's

giants just occurring to for the continued excitement number availability and different of dominance tech see and on, the So and the why had what it's felt can time a going a consolidation And the enthusiasm had the Jeremy I've of changing work doing. reasons with we're some is together business, of this and I during you industry. companies for rapidly wouldn't that always and which with that's we So holding period?

Operator

comes from of line Zaffino Ian question with The next Oppenheimer. the

Isaac Sellhausen

This is for Isaac Sellhausen on Ian.

Just the business. questions on a few transit

what nonrenewal the Is growth contract for could the provide strength expectations drove quarter. And the know because color I part OIBDA If that the previously. the you of in in you in strength loss-making secondly, QX. transit then on some in of transit mentioned of

I you generally wanted what understand growth for So MTA transit better the to at markets more anticipate just year. other or this

Matthew Siegel

the transit straight as I year expenses fourth and in performance, would from very specialty has large. to we the say, then that's throughout the transit, quarter the performing it quarter, MTA But And MTA, MTA. I in well fourth National goes, quarter, came been mentioned, Remember all turns the us, the quarter. continuing revenue is the the very just drives first For fourth strong. line the always MTA strength profitability in MTA driver. because as biggest good in

haven't lost any contracts. We material

throughout certainly. portfolio into We and haven't performing added than XXXX anything did XXXX XXXX is it material than better with -- in the

Operator

with Research. question the comes Barrington line next Patrick from of Sholl The

Patrick Sholl

how side, audience if minimum -- on more earlier? the pricing, just contracts could pricing update mentioned triggering on I the the potential like pressure question the any and the you was -- an the that in transit is then minimum could And the based some wondering I provide various with if bit and think to on on across I you provide that of the where adjustments guarantees on strength of contracts where guess, those? you portfolio stands ridership like, on some and I yes, just sort a the on of little guess, guarantees detail another of

Matthew Siegel

Okay.

just to ridership on XX% from of around a taking melting to On be -- pricing, where maybe pricing, maybe taxis. that's Maybe movers in current throughout work. First was yield it's XXXX, It XXXX. ridership most us so pricing was new it's back MTA the think our for from was are growth seems it transit good environment. sign or congestion of driven tired the in up, from it's of people I

January, in think I it about was XX%.

So the to a not directionally digital. was, in better and good. the product where it back but just had certainly, than performance transit -- more it's past. It's Then as more

All digital. our of big are franchises

Other that's closest I things recovering biggest on I transit as MTA, XXXX. it's it's ridership -- mentioned to our think benefiting our well. ridership

recovery. Some but Obviously, of New their in behind watch D.C., we're franchises, Francisco the we San ridership with very are the New York them other pleased Boston, York performance. closely,

Operator

no are pass time. would There There currently I remarks. at no Instructions] additional to back questions like the this questions closing any for are registered. conference [Operator waiting

Jeremy Male

today. very us speaking. for Jeremy Thanks it's much So joining

out-of-home you years. Before QX OUTFRONT. crossing results to much. all what Nick has of and future that very Matt, Stephan trajectory Stephan the forward you earnings thank I interest engagement OUTFRONT in Thank your I'm over the May, extremely know for to signing our for said, again in for off and XXrd presenting With outbound. potentially enjoyed indeed to look thoroughly I forward that informed community call industry and with quickly and over future. the excited is to paths of the look in time, investment the the my I've wanted that I you public

Operator

the That your participation enjoy call. concludes you Thank of day. rest today's for your and

Outfront Media (OUT) 25 Feb 252024 Q4 Earnings call transcript